Battery maker Eveready Industries Ltd on Friday said that it is raising prices of its products by up to 10% due to surging input costs, reports PTI.

The company said that rising zinc cost, a key raw material for manufacturing batteries, coupled with the excise duty hike in Budget 2010 are the main factors for increasing battery prices.

"Over the past four-five months, there has been a continuous upward climb in zinc prices, which has adversely impacted the manufacturing cost of carbon zinc batteries," Eveready Industries vice chairman and managing director Deepal Khaitan said in a statement.

Besides, the product segment had to bear 2% hike in excise duty to 10% from 8% made in the Union Budget 2010, the company said.

"These (factors) have left us with very little option but to pass on a part of the increase in the costs to the market. We are also increasing the maximum retail price (MRP) of all types of batteries by 5% to 10% with immediate effect," he said.

Eveready sells around 1.2 billion batteries annually. Besides dry cell batteries, the company offers household items like torches, rechargeable batteries, CFL lamps, packet tea and mosquito repellents.
 

The Planning Commission of India on Friday said that high inflation, primarily driven by rising food prices, is likely to ease in the next few months on the back of an expected good rabi crop, reports PTI.

"I expect food price inflation to come down in the next couple of months on the back of an (expected) good rabi crop," Planning Commission deputy chairman Montek Singh Ahluwalia, said at a conference.

Downplaying fears of wholesale price index (WPI) inflation touching double-digits, the Planning Commission official said, "I don't think this will happen. I expect WPI inflation to gradually come down."

With economic growth momentum returning, the Planning Commission expects a GDP growth of 8.5% for FY11 and a 9% growth in the subsequent fiscal, he said.

"I think the economy is doing very well. We have weathered an extraordinary crisis. Now we are well set to get back to 8.5% (GDP growth) in 2010-11 and hope to see a 9% growth after that," Mr Ahluwalia said.

"We are going to get back to the path of fiscal prudence," he said, adding that with the economy improving, he expected institutional investments to continue. “I think the fiscal deficit has been brought down—economic growth momentum has returned," Mr Ahluwalia said. "We are counting on this momentum continuing in the next two-years. That is what we predicted and that is what we were expecting."

According to him, the economy has shown very good resilience. The government was concerned about the high food prices which he attributed mainly to the drought conditions of last year.
"I think it (high food prices) is mainly because of the drought conditions last year. Excessive speculation and exaggerated reports have also contributed (to the price rise)," Mr Ahluwalia said. Now, however, with rabi crops coming in, he expected food price inflation to decline in the next couple of months.

On government borrowings and whether it would impact private demand, Mr Ahluwalia said, "There is no need for us to worry about government borrowings next fiscal," he said. Total borrowing is pegged at Rs4.57 lakh crore in the next fiscal.

Asked about the poor response which state-run units’ issues have received recently, Mr Ahluwalia said that the relatively poor response did not indicate that the government should slow down its disinvestment plan.

State governments should proactively take steps to improve basic infrastructure like health and education, Mr Ahluwalia said.

The Indian government on Friday said that subsidised fertiliser was being smuggled out to countries like Nepal and asked state governments to take stringent action, reports PTI.

Replying to supplementaries during Question Hour in the Rajya Sabha, minister of state for chemicals and fertilisers Srikant Kumar Jena said that smuggling was taking place from different parts of the country.

The government, he said, has written to chief ministers to take stringent action against urea dealers who may be involved in smuggling. States like Uttar Pradesh need to take steps to prevent smuggling, he said.

Explaining the compulsions behind the recent decision to hike urea prices, Mr Jena said that the cost had not changed in the past eight years compared to two price revisions during the National Democratic Alliance (NDA) rule.

The NDA government had raised urea prices by 20% when global rates were $110 per tonne. International rates have risen three-fold since, warranting a 10% hike in urea prices from 1st April, he said.

"The government has decided to increase the maximum retail price (MRP) of urea by 10% to Rs5,310 per tonne from the current Rs4,830 per tonne with effect from 1 April 2010," he said, adding that urea would remain under government control.

The minister said it was difficult to predict the quantum of fertiliser subsidy for the next fiscal as consumption was not known.